Impact of international trade on employment in Polish industrial sector

Gabriela Grotkowska

Ekonomia journal, 2008, vol. 20

Abstract: In this article I am trying to address the question of impact of international trade on employment and its skill structure in the Polish secondary sector. After presenting stylized facts concerning changes in employment and wages in the years 1994–2003, I estimate elasticity of employment versus international trade flows. Both direct and indirect effects (impact of trade through changes in labour productivity) are taken into account. The elasticity appears to be positive in the case of exports and negative as far as imports is concerned, but is much higher—as for absolute value—in the case of outflow of goods from Poland. What’s more, the sensitivity of employment for international trade appears to be much higher in the case of blue-collar workers than in the case of white-collar workers. Using estimated parameters and relative changes in trade in the analyzed period, the quantitative effects of trade are estimated: in spite of high dynamics of import penetration, higher elasticity of employment versus exports results in positive general effect of trade for employment (about 1.6 million workers as for secondary sector except for mining). It seems therefore that there are different factors that lie behind fall of employment in manufacturing (changes in demand structure, industry structure, technological shocks) and the main effect of trade was a changes of both skill and branch structure of employment.

Date: 2008

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